Capital gains exemption on duplex?

[Justin Boyd]

Would I be exempt from paying up to $250,000 in capital gains tax if I sold my duplex? When I purchased the property I lived in it for 2 years (within the past 5 years) while renting out the other half.

I’m seeing some articles saying I would be fully exempt for up to $250,000. Some other articles say that I would owe the full capital gains on the investment side (half the unit so it would be half the capital gains normal tax).

[Basit Siddiqi]

@Justin Boyd

You are eligible to exclude $250,000 of gain(if not married) for the unit that you lived in.
You will be responsible for reporting the gain as a result of the other unit that was sold.

The math is a little bit easier if both duplexes are equal in size.

You may be able to defer the tax on the rental side via 1031 exchange/QOF.